How to Pivot Your Startup

There are 1,000 startups in NYC and that number grows exponentially with the inclusion of San Francisco, Boulder, Austin, and a dozen other burgeoning regions around the world.

Part of the nature of young companies is that ideas are a dime a dozen. Occasionally during the early stages of a startup, some founders have the epiphany “this isn’t working” — that the success they were seeking won’t be fulfilled by the current trajectory.

When this happens many startups choose to pivot, or change their offering in a dramatic way. Sometimes this means going double-down on a spin off product, positioning an existing product to a new tier (ie: smb -> enterprise), or switching markets entirely.

The benefits of a pivot vs. complete shut-down are numerous:

Application of lessons learned from previous, palpable attempt

Value of the team (hiring is hard, 1+1 = 3)

Momentum

There’s a particular emphasis on momentum, which is often measured in cash. The “fail early, fail fast” mantra is a proponent to this as entrepreneurs who kill a project before spending their hard-earned venture capital can afford to give it another shot without starting over from scratch.

As Brad Feld writes, “The dude that just came off a failure and is ready to go again is super-extraordinary-amazingly hungry for a success.” We agree.

A founder’s second chance at up-and-to-the-right business success requires an even more granular level of focus and determination, beginning with a proper identity for the new offering.

After working with thousands of small businesses and hot startups like Risk.io, Sendgrid, and Onswipe to guide them through the rebranding process, we wanted to share our insights on pivot best practices to prevent as many founder headaches as possible.

1. Choose a new name

Simple, but not easy. You spent a ton of time identifying your first baby, snatching up domains and doing the “brand” thing to pump life into an infant company. But alas, it’s that time again. So go on a sabbatical (or don’t, money is tight), hire an expert, whatever.

Just don’t get too entrenched with a new idea until you…

2. Run a domain search

Sounds obvious. Check GoDaddy, right? Wrong. Just because your preferred gTLD is available doesn’t mean there aren’t a dozen spinoffs in less familiar territories. Use a tool like domai.nr to widen the scope of your search, both in terms of existing entities as well as during the idea creation stage.

The next bit here is a sanity check — GOOGLE the name you’re considering. Forget about streamlined search technology so-and-so. Just see what people are saying about the term or word you’ve come up with. If the exact phrasing is unique but related searches are phallic, you might want to revisit the drawing board.

Other resources:

WHOis (if a domain is already registered, use this to contact the owner and negotiate a deal)

NameChk (you need more than a website — this tool lets you check availability of your name on 150+ social networking sites)

USPTO (Patent / trademark search, in the case you want to protect a technical phrase that’s critical to the sales pitch or product viability)

3. Secure new identities

Your domains are either freely available or you’ve sourced contacts for negotiations. Great.

We won’t get into specific tactics, but a good start is handling all communications between your company and domain sellers through an intermediary, preferably a trustworthy friend not involved with your company.

The idea here is to deter the seller from getting a glimpse into your resources. If they can dig up recent fundraising rounds or associations between you and precious capital, they have too much leverage. Read Fred Wilson’s Finding and Buying a Domain Name for more insights.

4. Design logo

It’s time to get a new logo. Startups who fail to move past this step waste all their resources (momentum) on steps 1-3 instead of building the new offering, so iterate like a boss and make this happen without too many cooks in the kitchen.

Design is subjective so we won’t solicit any vendors, but rebrand.com may be a good place to start.

Pending the priority of your aesthetic, drafting a style guide is also appropriate at this step. A style guide directs the high level approach to future content (blog, web design, marketing materials) and is therefore a big-ticket item in the establishment of a new, cogent brand.

5. Set up staging

This is a logistical but pertinent detail. Your website will be the primary outlet for all new exposure, so you have to launch the right way.

Think your devs should do a quick and dirty weekend deployment? Think again. The most trivial details (A records, etc) can take 1-2 days to propagate so even if you’ve got great front-end guys doing the grunt work at 2am, you’re still leaving too much room to fail.

Set up staging and build out the new website as much as possible prior to announcing your pivot. This step alone might account for as much as 80% of your rebrand roadmap, but the wait will be worth it. And yes, we just made up that number.

In the spirit of lean methodology, don’t worry so much about the presence of content but the presence of sanity. This means no broken links, respectable 404/500 pages, and a slew of redirects from top directories on the former site (/About, /Contact are a couple examples).

If you use WordPress for any part of your site, we love WP Engine‘s many features for staging / production environments. They also offer the option to automatically scale your package based on traffic, which could come in handy with unexpected page views following a big pivot announcement.

6. Set up email

You’ll probably stick with whatever service provider you’re already on, but in case you run Google Apps for Business there are a couple things to know:

Google does not provide a way to change your domain from the admin panel

Either way you’ll need to provision users on your new account and probably want to migrate their old mail prior to launching the new brand. This allows employees to transition cleanly from 1 work email account to the next without having to straddle separate identities, inboxes, folders, and contacts for days / weeks / months.

A common structure at most startups is firstname@company, but the path of least resistance is to keep email usernames in the same format as before. This helps with continuity and will ease the friction on any change management documentation you might need to share with your team upon the official switchover.

What we’ve found from working with our customers is that communication becomes fuzzy as account maintenance increases. If your team is managing 2 email accounts, 2 signatures, multiple cloud storage platforms for old/new files, and so on, a rebrand process can take months.

Since you need to spend more time building the new offering and less time fiddling with back-office, our emphasis on doing email ‘right’ is a force to be reckoned with.

8. Launch

It’s time to go live. There are a ton of small things you can do now to produce the biggest impact, and we recommend Rand Fishkin’s command of SEOMoz -> Moz as an incredible and recent example of how deeply involved you can make your team, customers, and prospects during this exciting stage.

A few do’s and don’ts:

Do everything simultaneously.

Don’t deploy your website at 2am and the press push at 9am.

Do pause your team dynamics for the inevitable fluster of attention, frustration, and bugs that the new launch will inevitably surface.

Do aim for Monday morning to give yourself a week of runway.

Don’t yell at someone when a link is broken.

Do relax. The rest is history.

Also rest assured that no matter the tactical elegance, you’ll undoubtedly receive an onslaught of customer confusion after launching. “I never got the memo” and “You didn’t make this clear enough” and “What am I supposed to do now, my life is ruined” will flood your customer service ticketing system, and that’s OK.

To alleviate this, some companies leak news to customers first and media second. But no matter how many reminders or blog posts you’ve written to forewarn your fans, many will opt for a shouting match over kindness and understanding.

Ultimately, the silver lining to customer frustration during a pivot is fruitfully ironic. You’re here because you needed a new product offering, and if your customers don’t love the pivot they’ve only proven your conviction: they weren’t your ideal customers to begin with.

With any luck this guide will help demystify the pivot process so you can focus on achieving success with the next best thing.